At its best and biggest, Spirit Airlines

was the worst. The same year it was

hailed as one of the fastest growing US

domestic carriers after introducing

seven new A320s to its fleet, adding

17.9% more available seat miles, and

opening over 20 new non-stop routes,

Spirit also made news for how frequently

people complained about it. Here's the

frequency with which other carriers

received complaints over cancellations,

delays, and other flight issues over a

four-year period, and here's the

frequency of complaints at Spirit,

tripling most and trending upward. A

decade later, little had changed. The

airline had risen to the seventh largest

North American carrier by total

passengers, while also coming in second

to last in J.D. Power's customer

satisfaction ratings. But just a few

years after that, with the arrival of

flight NK1833 at Dallas/Fort Worth in

the early hours of May 2nd, 2026, the

carrier was now gone entirely. And

rather than celebrate the end of an

airline that nickel-and-dimed you on

everything, that delayed and ran late

often, that offered a generally

unpleasant flying experience, its end

was met with a sort of melancholy

nostalgia. Effectively, a final proof

that while the product wasn't pretty, it

was effective in filling a previously

unserved corner of the market. And

though easy to conflate the carrier's

collapse with its ultra-cheap approach,

the reality is that Spirit found a niche

with its ultra-low-cost model rest

hadn't quite recognized, but would

eventually race to catch up to.

With a fleet maxing out at over 200

planes and nearly 20,000 employees,

Spirit momentarily mastered its niche,

the ultra-low-cost, entirely unbundled

domestic leisure market, but this took

decades to refine. From the start,

Spirit wasn't for the business traveler,

it wasn't for the wealthy, it was for

budget-conscious leisure travelers. Born

out of a trucking company that had begun

to dip its toes into air shipping,

Spirit began in 1983 as Charter One.

Rather than actually operating its own

flights, the company was more so a tour

operator coordinating gambling

itineraries first from Detroit, Boston,

and Providence to Atlantic City, then

eventually the Bahamas and Las Vegas. A

decade in, these leisure services had

proved popular enough to justify

expansion of both the fleet and [music]

the routings. Filing with the Department

of Transportation in 1992 to run

scheduled [music] passenger services, a

new budget-friendly leisure carrier was

born. Rather than keeping its Convair

580 turboprops going, the carrier

acquired 13 DC-9s and renamed itself

Spirit Airlines. From just three routes

in 1992, the service quickly expanded.

By 1996, the network looked like this,

still based out of Detroit and running a

lot of popular domestic budget-friendly

leisure routes from the Northeast and

Midwest now to Florida and Myrtle Beach

alongside Atlantic City. As the airline

grew through the decade, this

north-south vacation destination

orientation largely remained along with

an addition of a Detroit-to-LA route in

1999 and the company's first true

international route with a service from

Fort Lauderdale to Cancun, Mexico.

Through the '90s, Spirit established

itself as a bonafide low-cost carrier.

The planes, first DC-9s, then briefly

larger MD-80s towards the end of the

decade, were neither new nor especially

amenity-laden. The service, punctuated

by a 1994 mistake that saw the company

unintentionally overbook 1,400 tickets,

was going to be hit or miss sometimes.

But ultimately, the tickets were going

to be comparatively cheap and you still

get a drink, a snack, a checked bag, and

your choice of seat. It was budget, but

budget in the same way that Southwest

was budget.

This wasn't working. In 1999, Spirit

sued Northwest Airlines in what would

become an instructive moment for the

company. They alleged that Northwest, a

legacy airline, had slashed their prices

out of Detroit and flooded the market

with tickets in an effort to push Spirit

out. Spirit would eventually settle with

Northwest, but Northwest argued that it

maintained profitability along those

routes throughout the period.

Ultimately, the strategy would help push

Spirit to relocate its headquarters to

Fort Lauderdale, but it pointed at an

issue that was increasingly beginning to

cost the company at the turn of the

century. It just wasn't quite cheap

enough to compete with legacy carriers'

cheapest options. In the early 2000s,

the company was now losing money. It was

floundering and it needed a shot in the

arm.

The transformation from cheap to

cheapest started with the 2005

appointment of Ben Baldanza as

president, who had lamented the lack of

a true European-style ultra-low-cost

carrier in the US. Baldanza gained an

all-important ally when private equity

firm Indigo Partner bought a controlling

stake in [music] Spirit a year later.

Having global experience with and an

interest in ultra-low-cost carriers,

>> [music]

>> the new controlling owner, along with

the company's new leader, went all in on

ultra-cheap. They called this strategy

unbundling. The idea that the listed

price of a flight would guarantee

nothing more than a spot somewhere on

the plane. A concept simple enough, but

one that would have to be introduced

incrementally. First, in 2007, that

meant a $10 fee for a second checked

bag, then no complimentary food or

drinks, then no free seat selection.

You'd have to pay for that. The

following year, there was now a fee for

a first checked bag, then even a fee to

print a boarding pass. Next, in 2010,

the company announced an industry

[music] first, a $45 fee for overhead

storage of carry-on items. Even Ryanair

hadn't tried such a fee yet, and the

policy created such an uproar that US

senators introduced a bill to stop it.

The airline was now well on its way to

the worst, but it was offering fares so

outrageously low that, while it was easy

to complain about the product, for the

cash-strapped college kid looking to get

south for spring break, you just

couldn't argue with the prices. At the

same time Spirit normalized unbundled

airfare to the American traveler, it was

overhauling its fleet to exclusively use

Airbus A320s as it streamlined

maintenance and maximize [music] seats

per plane. In 2011, having found its

niche and gone all in, Spirit went

public. That same year it garnered more

than 30% of its total revenue from fees.

While the morals of it all may have felt

questionable, the results were

undeniable as total passengers ballooned

from under 7 million in 2010 to almost

34 million in 2019 while the company

turned a profit each of those years. The

company was unapologetic but upfront

about its pricing model. Its ads were

aggressively targeted to young budget

travelers and its network was expanding.

At the end of the decade, the company

reached its peak. It offered about the

worst flying experience possible but it

was flying more passengers and making

more money than ever through business

model still rather unique in the

American airline scene.

As with every airline in every country,

COVID was catastrophic for Spirit. A

near complete loss of revenue.

>> [music]

>> But where their fortunes truly shifted

relative to the rest was in the recovery

years. While other US airlines marched

back towards profitability, Spirit just

didn't. For some reason, an

industry-leading business model

pre-COVID just couldn't come back to

life after. But what the calamity of

COVID masked was the continued

progression of trends that were already

starting to put pressure on the airline

in the years before.

A strange thing had been happening.

Americans were increasingly choosing to

spend more to fly. It's not that people

wanted to pay more for the same product

but rather on average, passengers were

more frequently electing to pay for more

premium offerings. As the major US

airlines started to post profits again

post-COVID, they kept remarking in their

earnings releases that their economy

cabins were flat to down whereas premium

economy and business class were driving

their revenue growth. Airlines responded

to this by building more business class.

United unveiled a new 787 configuration

with just 20% of space allocated towards

standard economy, while JetBlue and

Frontier elected to roll out business

class cabins fleet-wide for the first

time. Explanations abound for this

phenomena, but the simplest and surest

is that Gen Z and Millennials are

representing a larger and larger portion

of spending power in America, and these

younger generations have always spent

disproportionately on experiences versus

physical goods. That includes travel,

which these generations allocate a

greater portion of their income to than

others, and with more money devoted

towards travel, that's more people who

elect to treat themselves to extra

legroom, premium economy, or business

class.

It used to be that premium seats, and

especially domestic premium seats, were

primarily purchased by business

travelers with expense accounts, and so

budget airlines, which are inherently

leisure-oriented, didn't have to worry

about premium offerings. Once this

premiumization trend emerged, Spirit's

primarily economy fleet had no way of

capturing the revenue upside, while it

also suffered a downside as some of the

trend manifested through travelers

electing to pay more for a full-service

airline rather than Spirit's bare-bones

offering. The low-cost market was

eroding.

But on top of that, Spirit's ability to

capture that tranche of the market was

eroding, too. Throughout the late 2010s,

Delta, American, and United each

progressively rolled out a new fare

class that they called Basic Economy.

Essentially, they just offered the same

as Spirit. Rock-bottom prices, but with

no bag, no seat selection, no refunds,

nothing included. [music]

The major airlines' pricing algorithms

would often match or nearly match

Spirit's fares in the market, but

[music] the big airline brand names

would win customers over thanks to a

perception of better service and

reliability. In the pre-COVID years,

this did not represent an existential

threat to Spirit, just a new dimension

of competition, but it did appear to

chip away at its profits. What was a

mid-20s operating margin in 2015 fell

[music] to low 10s by the time the first

coronavirus cases emerged in Wuhan. Just

as with the premiumization trend, this

momentum appeared to continue through

COVID, and by 2024, United, for example,

reported that basic economy now

represented 16% of its domestic

passenger base.

But, while this represented a slow

erosion of Spirit's financial moat, the

airline ran into far more acute issues,

as well. Back in 2016, Spirit became the

first US airline to acquire the brand

new A320neo. [music]

The aircraft's innovative Pratt &

Whitney PW1100G geared turbofan engines

burn about 16% less fuel than the

previous generation, and considering how

much Spirit used each one of its

aircraft, this led to some real cost

savings [music] during its lucrative

late 2010s years.

But, the engines had issues. Come summer

2023, Pratt & Whitney issued a recall

notice.

>> [music]

>> They discovered that for 6 years, their

factory in New York had been using

contaminated powdered metal to create

the blades for the engine's core. The

contamination was subtle enough that the

engines passed inspections and typically

flew perfectly fine, but while

operating, microscopic cracks were

forming far sooner than expected. This

is only known to have ever caused one

actual aircraft incident, and even that

only resulted in an aborted takeoff, but

if left unaddressed, as engines got

older, more failures would inevitably

follow.

>> [music]

>> So, regulators called for inspections of

about 1,200 potentially affected

PW1100Gs, and these inspections were far

from trivial.

Operators had to park their aircraft,

physically remove engines, then ship

them to one of only about 20 shops

worldwide qualified to undertake the

process. These shops would then

disassemble the engines, inspect each

and every blade using ultrasonic

devices, then replace affected blades.

All in, this process took upwards of 250

days and there was the dual constraint

of shop capacity and replacement blade

supply, meaning aircraft groundings went

on for years. At its peak, Spirit had to

park 40 of their A320neo family aircraft

and still pay for their lease costs.

With constraint on their aircraft

supply, the airline completely pulled

out of Boston and Cleveland and heavily

cut back on Dallas flying, leaving less

opportunity for them to dig themselves

out of their financial hole. While they

did get some compensation from Pratt &

Whitney, it was [music] far from enough

to make up for the financial loss.

Spirit wasn't alone in its financial

struggles post COVID. The same pressures

eating its profits were present across

all American low-cost airlines. As cash

reserves dwindled, they all scrambled

for solutions and some chose to turn to

the most tried and tested solve for

airline financial woes, consolidation.

On February 7th, 2022, Spirit announced

[music] its intention to merge with

Frontier. The two airlines operated near

identical business models, barebones

fares on leisure-oriented routes, and

even flew the same aircraft types,

making fleet integration simple. But

they were also different in the ways

that mattered. Frontier's network was

oriented more towards the west, while

Spirit focused on the east, Caribbean,

and South America. Only 18% of the

pair's routes overlapped, meaning

combined they could become a truly

nationwide mega ultra-low-cost carrier,

representing the fifth largest airline

in America. All that was left to make

the merger plan official was for

shareholders to vote on the matter, but

considering this was a board-approved

deal,

>> [music]

>> precedent suggested that this was all

but a formality. Precedent, however, was

wrong.

JetBlue had a different plan. They

submitted an offer to buy Spirit for $33

a share, far above the 25 or so dollars

per share the Frontier deal implied. On

paper, this was a far more valuable bid.

Regardless, Spirit's board responded

with this, "Our board has unanimously

determined that JetBlue's proposal does

not constitute a quote superior proposal

under Spirit's existing merger agreement

with Frontier. We believe a combination

of JetBlue and Spirit has a lower

probability of receiving antitrust

clearance. In short, Spirit's board

believed that even if they and their

shareholders agreed to the merger

proposal, the merger was unlikely to

happen as the Department of Justice

would sue to block it under the

provisions of antitrust law arguing that

it was harmful for consumers. Spirit had

good reason to believe this. The Biden

DOJ had earned a reputation as perhaps

the most aggressively anti-consolidation

administration of the 21st century. And

in fact, JetBlue had already been

targeted by this DOJ with a lawsuit to

stop its Northeast Alliance joint

venture with American Airlines.

Spirit's perspective was that the Biden

administration would consider the

potential consumer harm of a tie-up with

Frontier quite differently than one with

JetBlue. JetBlue, after all, is not an

ultra-low-cost carrier. It

definitionally fulfills some of the

criteria of a low-cost carrier, but

operates more of a hybrid model with

extra legroom, free Wi-Fi, business

class offerings, and even long-haul

routes to Europe. Their plan, if they

were to acquire Spirit, was to fold the

ultra-low-cost carrier into the JetBlue

brand and operate it the way JetBlue

operated, meaning the US airline market

would lose the price competition that

Spirit in its current form provided. In

the Frontier merger scenario, meanwhile,

two ailing ultra-low-cost carriers would

consolidate into a larger, stronger

competitor, potentially elevating their

competitive influence on the broader

market to a point greater than the sum

of their parts.

Shareholders, however, did not share the

concern. Spirit lacked the votes to

approve the merger, and so they kept

delaying and delaying and delaying the

vote. For months, a cycle emerged of

another delay, another tweak of terms by

Frontier and JetBlue, and another delay

until the writing was on the wall.

Shareholders wanted the JetBlue offer.

It was just too tantalizing.

And so, the board approved the JetBlue

merger, shareholders soon followed, and

the two airlines started the lengthy

process of preparing to close the

transaction. But then, as foretold, the

Department of Justice sued to stop the

merger on antitrust grounds. In fact, in

their original complaint, the DOJ cited

what Spirit itself said the DOJ would

say, that this was a, quote, "high-cost,

high-fare airline buying a low-cost,

low-fare airline, and that, quote, a

JetBlue acquisition will have lasting

negative impacts on consumers." The

facts were hard to argue with. Quote,

"JetBlue estimates that when Spirit

stops flying a route, average fares go

up by 30%." At trial, the airlines

argued that even if low-cost capacity

would be eliminated, the creation of a

more meaningful non-budget competitor to

Delta, United, and American would be

pro-consumer, and they offered

divestiture of key assets like slots and

gates to offset any remaining consumer

harm. Ultimately though, the odds were

never good. From the perspective of

antitrust law, it was about [music] as

slam dunk of a case as ever makes it to

trial. There was clear, objective

reduction of competition, so from the

point at which the DOJ decided to pursue

it, it appeared far likelier than not

that they were going to win, and so they

did. Spirit was right back to where it

started, yet with hundreds of millions

of dollars of cash and two years wasted.

In the aftermath, Spirit floundered

through various half-hearted solutions

to dig itself out of its hole. It

attempted to shrink to profitability by

cutting its fleet back to less than 100

aircraft, almost entirely pulling out of

the West, and instead refocusing on

shorter distance East Coast north-south

flying to vacation destinations. In

2023, they were burning about 1.2

million dollars in cash a day to keep

afloat. In 2024, this ramped up to 3.4

million dollars, and by 2025, it

spiraled yet further to 7.5 million

dollars in financial loss per day. The

airline went through multiple rounds of

Chapter 11 bankruptcy, it rejected

another far weaker merger offer by

Frontier, and for most of 2025, it

perpetually sat on the precipice of

collapse. Yet, each time it looked

imminent, Spirit found another lifeline

to fund another few months of

operations.

But then the slow bleed was stopped by a

beheading. The Trump administration

attacked Iran, Iran retaliated by

closing the Strait of Hormuz, oil prices

spiked massively, and the airline's

single largest cost outright doubled.

The end was now inevitable. The business

had failed. Spirit had sunk, and the

best option for investors was to accept

reality and recover what [music] assets

they could. In the early hours of May

2nd, 2026, Spirit sent out its last

press release. 17,000 individuals lost

their jobs, and a 34-year legacy of safe

transport of almost half a billion

passengers came to an abrupt and

unceremonious end as the last yellow

Airbus touched down [music] at DFW.

When this end became inevitable is a

much debated question. There are plenty

of differing opinions on which decisions

could have altered this outcome.

>> [music]

>> In the reality where Spirit did

successfully merge with Frontier,

there's every world in which that would

have sunk both airlines. While

Frontier's post-COVID years were

comparatively better, they've still yet

to regain long-term profitability.

Similar to Spirit, they've been cycling

through various business model tweaks,

but there's not much in their financial

results to yet suggest they've found

their footing. While there's an argument

to be made that the consolidated larger

airline emerging from a merged Spirit

and Frontier could have competed its way

to profitability, the fact that almost

every American low-cost carrier, even

beyond the two, is still losing money

makes that incredulous.

Perhaps the more convincing argument is

that the Biden DOJ should have allowed

the JetBlue merger, even if the

antitrust case against it was strong.

Informed observers could understand all

the way back in 2023 that Spirit was

possibly on a path towards bankruptcy.

From the DOJ's perspective, the

counterfactual was Spirit remains

Spirit, when in reality, it was that

Spirit collapses. In retrospect, it

becomes fairly uncontroversial to say

that the better outcome would have been

for Spirit to consolidate into JetBlue,

saving thousands of jobs and creating

stronger competition against the majors.

Effectively, the Biden DOJ took a risk,

and the risk failed.

In any world though, Spirit could not

truly remain Spirit. The Spirit that

people love to hate, the rock-bottom

fare, Buzz Ball pedaling, bright yellow

airline for the masses, wasn't killed

off by the Biden DOJ or the

Trump-induced oil spike, or any single

action by anyone, because there was no

world in which the form the airline took

at its peak could continue into 2027 and

beyond. The American airline industry

had changed, and so Spirit's

ultra-low-cost model was as good as

dead, regardless of what mergers or

metamorphoses happened next.

In spite of Spirit's reputation among

passengers, it was undoubtedly good for

them. In a vast country with little

public transit, the airline enabled

movement for more by asking for less. It

brought people to family and friends,

births and deaths, weddings and

funerals, when it might not have

otherwise been financially possible. In

death, perhaps Spirit's strongest legacy

is the realization that as much as the

American air passenger loved to hate it,

they also hated to love it.

In research for this video, it quickly

became clear that mainstream news's

portrayals of the causes of Spirit

shutdown were often quite skewed and

incomplete. There was an enormous,

overwhelming amount of coverage, but it

was hard to know what was legitimately

useful information versus incomplete

facts trying to push a politicized

narrative. Right-leaning platforms would

attribute the shutdown on the Biden

administration's block of the JetBlue

merger, whereas left-leaning platforms

would deemphasize discussion of that

while focusing on how high fuel prices

caused by the Trump administration's war

in Iran pushed the airline carrier over

the edge. That's why I found our

sponsor, Ground News, to be a crucial

tool while writing this video. I've

partnered with them since 2023, and this

is why. Almost 600 sources covered the

Spirit Airlines story, and when I looked

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see how each news outlet framed the

story. [music] Ground News is an app and

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even these sources tend to confirm my

biases by characterizing politicized

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